Society is likely to overallocate resources to produce goods

Society is likely to over-allocate resources to produce goods that O A. generate negative externalities O B. are public goods. ° C. are merit goods. OD. generate positive externalities.

Solution

1) society is likely to over-allocate resources to produce goods that generate negative externalities because of the excess resources against the raw material required for production of goods.

2) markets tend to over allocate resources to the production of a good when there are too  negative externalities

First of all externalities are spill over effects which can only be minimised or controlled .They arise from consumption and production, like waste emission , harmful solid waste produced , raw material wastes , pollution by carbon emissions etc

   Negative externalities can be called as an external cost that is a result of transactions between the first ,second and third party